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Helping customers to better money management

By : Martin Shires

July 14, 2015 08:30 AM

When we talk about customer experience in banking, a lot of what we discuss is around usability and accessibility. For instance, how easy it is to use an ATM or a mobile app; whether we can respond to customers’ needs quickly and match their expectations; and how long someone waits on hold on the phone before speaking to a real person.

 

These are all essential elements but one area that needs some extra attention is how a particular service can make people’s lives better by assisting in their money management. Not dropping into the red each month, not missing a bill payment - these are things that customers value above all.

 

A couple of new reports highlight how mobile banking helps.

 

The Federal Reserve’s latest update on mobile banking and payments in the US tells an interesting story about empowering consumers to make better decisions; all because of mobile technology.

 

Firstly, consumers who use mobile banking are doing so for fairly obvious reasons, such as to check an account balance or to move money from one account to another. But they’re also getting notifications from their banks that help them to manage their money better.

 

For example, 46 percent of people who use mobile banking have received a low balance alert. That’s pretty useful, clearly, but more importantly consumers are responding. More than four in five (83 percent) people who were sent this message had actively done something to fix it - either by transferring money into the low balance account from another, by depositing money into the account, or just by reducing spending.

 

“Mobile phones can provide readily accessible and timely prompts that may help consumers make different, and perhaps smarter, financial decisions,” the Fed report stated.

 

“The actions consumers take in response to the receipt of a text message or e-mail notices from their financial institutions demonstrate some of the potential effects of this technology for encouraging consumers to engage in different financial behaviors that may prove to have beneficial outcomes.”

 

It’s also interesting that when we talk about mobile banking it doesn’t just pertain to smartphone owners - a text message with a low balance alert is equally important. The UK’s Financial Conduct Authority goes as far as to recommend banks use these types of notifications to tell customers about better rates they could be getting on their account balance – previously a common source of customer complaint, tainting bank reputations for service, when they didn’t offer this service.

 

Meanwhile, a study by ING among 14,000 banking customers globally found that 85 percent of Europeans who use mobile banking can list at least one way in which it’s helped them manage their money better.

 

Improving the way banks communicate with customers doesn't just have to be with mobile technology, but the benefits from this improved customer behavior should be clear.  This is modernizing and replicating of the branch experience at its best – delivering the kind of practical, yet essential daily services that were previously only the preserve of human interaction, to an even wider audience.

 

Explore more with NCR Financial Services.

Martin Shires

New Branch Solutions Mkt Mgr, Strategy & Marketing

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Martin Shires is a global evangelist for branch transformation strategy, based out of NCR’s R&D center in Dundee, UK. Martin has held a number of senior regional management roles in European retail banking.